I am very sorry to hear about the proposition you are faced with. While it may be "coercion," it is not illegal to "coerce" an employee in this manner. The reason stems from the fact that employment in VA is "at will" absent an agreement to the contrary. At will employment can be terminated or modified for any reason not amounting to discrimination on the basis of a legally protected trait (race, religion, gender, etc.) or retaliation for engaging in certain forms of legally protected conduct (filing a wage claim, taking FMLA leave, etc.). It doesn't matter whether the basis for termination/modification is fair, reasonable or even true.
So, since your employer could simply demote you without your signature on the "voluntary demotion" papers they have given you, they can condition your job on signing those papers. Basically, the papers don't matter--your employer can already legally do what they are seeking to do. They do not need to pay you as much as the other counter person, either.
The bot***** *****ne is that employers retain vast discretion over how they can manage their business. The law does not require them to be fair or to do what is reasonable. The power of an employee faced with this situation is to leave the job and seek alternative employment on more favorable terms. But the employee cannot force the employer to employ them on the terms the employee believes are appropriate.
So, you are not really in a position of legal leverage. You can threaten to quit and attempt to negotiate a better hourly wage with your employer, but if they are not open to negotiation, your options bleak as they are, are to take the employment offer or leave it and seek other work. If the paycut you are being faced with is substantial (at least 30%) there is a decent chance you will be eligible for unemployment benefits if you resign under these circumstances.
I hope that you find this information helpful and am genuinely sorry if it is not what you were hoping to hear. Please do not hesitate to let me know if you have any questions or concerns regarding the above and I will be more than happy to assist you further.
If you do not require any further assistance, please be so kind as to provide a positive rating of my service so that I may receive credit for assisting you. Very best wishes moving forward.